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Receivable Turnover Case Study: CVS Company

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The company has a receivable turnover ratio of 15. This means that in 1 year period, the company turned its accounts receivables to cash 15 times, or the company had collected the receivables from their patients every 24 days. Its receivables of 9,687 are part of the company's revenues of $139,367 which the company generates from prescription drugs, cosmetics and various merchandise. It also generate revenues from its healthcare services through their medical clinics which are mostly located in the CVS store. Based on the effeciency ratio, the company is effecient in collecting their recievables. However,the company has a low effeciency ratio compare with the industry.

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